What committee controls the Federal Reserve System and is responsible for monetary policy?

The Federal Reserve Board is the primary governing body of the Federal Reserve System and holds the crucial responsibility for overseeing monetary policy. This board consists of members who are appointed by the President of the United States and confirmed by the Senate. It plays a vital role in managing the nation’s money supply, setting interest rates, and implementing policies that influence economic stability and growth.

The decisions made by the Federal Reserve Board regarding monetary policy, such as adjusting the federal funds rate or engaging in open market operations, directly impact inflation, employment, and overall economic health. The board's authority enables it to respond to changing economic conditions and challenges effectively.

In contrast, the other choices listed do not have the overarching authority or responsibility for monetary policy. The Monetary Policy Committee is not an official committee within the Federal Reserve; it may sound relevant but does not exist in this context. The Commercial Bank Advisory Board and the Financial Institutions Committee serve different roles and focus on specific industry needs or regulatory issues rather than the broader strategies of monetary policy that the Federal Reserve Board embraces.